How China’s First Lady, Tencent and Alibaba empower a home grown Luxury Fashion Industry

DavidMay 06, 2017

Chinese President Xi Jinping’s Mar-a-Lago meeting with his US counterpart Donald Trump generated a buzz over their glamorous wives – one a former singing star and the other a supermodel. But it wasn’t the first time Chinese first lady Peng Liyuan has dazzled international audiences with her signature chic, yet conservative attire embellished with Chinese motifs, which subtly lends cachet to the country’s burgeoning fashion industry.

As part of the“Peng Liyuan effect”, China’s otherwise Western bling-obsessed consumers were swift to seek out the non-conspicuous-luxury labels that tailored her suits, qipaos and jackets in public appearances, emptying their shelves and pushing the low-key designers – all Chinese – into the limelight.

Guangdong apparel label Exception de Mixmind saw its Beijing boutiques suddenly crammed with middle class customers after its founder Ma Ke emerged out of the shadows as the couturier of Peng’s iconic black trench coat seen on her arrival in Moscow in 2013, during her husband’s first trip abroad as China’s new leader. Ma’s other sartorial line Wuyong – meaning useless in Chinese – received a similar blaze of publicity.

Now, in market disruptive manner,Tencent’s WeChat and Alibaba’s Taobao have given a vital boost to the country’s indigenous luxury brands as tech-savvy millennial shoppers embrace social media and online marketplaces by the hundreds of millions. Alibaba owns the South China Morning Post.

And that is perhaps what a relatively lesser-known Western label would find it hard to achieve with the help of eBay and Whatsapp, even though they might have Michelle Obama and Kate Middleton as spokeswomen to catapult them to world fame, as what happened with America’s J Crew and Britain’s L.K. Bennett.

“In China nowadays, it’s all about WeChat. By selling our products on WeChat, we were able to enjoy a 70 per cent profit margin,” Masha Ma, the first Chinese fashion designer chosen to design uniforms for Chinese medalists at the Rio de Janeiro Summer Olympics, told a Macquarie China Conference panel on Monday.

Educated at London’s Central Saint Martins school, Beijing native Ma interned with British fashion guru Alexander McQueen before establishing her namesake high-fashion label in China in 2008. Having dressed celebrities Angelababy, Yang Mi and Naomi Campbell, among others, she is now a regular at Paris Fashion Week.

Ma added: “Taobao is offering a low-cost platform for young designers to showcase their creations, many of which do sell very well.”

There is good reason for China’s emerging fashion houses to ride on the country’s internet boom that is being supercharged by tech giants Tencent and Alibaba, two of Asia’s largest companies by market capitalisation.

It is increasingly common for Chinese consumers sitting at home to browse clothes and accessories from a fashion label’s official account on WeChat, the ubiquitous social messaging app with more than 762 million monthly users. The buyer can chat with a sales associate and make the payment with a swipe of the finger – all within a single app. Meanwhile, young Chinese fashion designers who can’t afford to set up physical stores have found Taobao, China’s biggest online bazaar, fertile ground to reach out to millions of potential customers and build up their fan base.

“If you look at their pages, you’ll find many of their items have gorgeous designs,” Ma said.

One example is Ms MIN, a luxury apparel brand founded by Chinese designer Liu Min on Taobao in 2010. Six years later, with steady profits and recognition by top fashion magazines like Vogue, the brand opened its first brick-and-mortar boutique in the prime shopping complex of Shanghai Centre, calling Christian Louboutin and Miu Miu as its neighbours. Liu made her way into the star-studded Met Gala in New York in 2014 at the invitation of Lane Crawford, joining the likes of Kim Kardashian.

The label is still available on Taobao, with a vintage-inspired dress selling for 3,800 yuan, more than half of a Chinese white collar worker’s monthly salary. However, market insiders warn that an overreliance on “grassroots-dominated” WeChat and Taobao, which are only a few clicks away from anyone with a smartphone and internet access, will take some of the sparkle off the appeal reserved for designer brands.

“To cultivate their deluxe image, they eventually have to have a proper physical presence when they gain sufficient financial prowess,” said Tang Xiaotang, founder of luxury retail consultancy Nofashion.

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David Lee, educated in Denmark, China and the UK, gained extensive work experience with NGOs (Int"l Red Cross and UNESCO) as well as in the fields of training and education. He is part of BMG's China office and supports services like translation, localization, market research and analysis as well as social media planning and management. David also has in-depth insight into the Chinese travel, shopping and luxury market, paired with creativity, business acumen and a passion for Social Media.